Tennessee House Bill HB0366

Tennessee 2025-2026 Regular Session

• Introduced: 1/27/25
• Refer: 2/5/25

Caption

AN ACT to amend Tennessee Code Annotated, Title 67, Chapter 5, Part 6, relative to property damaged by disaster.

Summary

HB0366 amends Tennessee property tax law to address how real property is assessed when a building or improvement is moved, demolished, destroyed, or substantially damaged by a disaster late in the year. Under the bill, if such damage occurs between September 1 and December 31 and the structure is not restored or replaced before January 1, the assessor must adjust the assessment to reflect the property’s post-damage value rather than its January 1 status. The bill also requires the improvement’s assessment to be prorated for the portion of the year before the damage, with that proration applied to the following tax year. The bill creates a separate rule for properties damaged in a disaster declared by the President of the United States. In those cases, affected buildings or improvements in the declared counties must have their annual assessment prorated for the time they were destroyed or substantially damaged and not replaced or restored, even if repairs are completed by January 1 of the next year, so long as the damage period exceeds 30 days. Property owners must apply for this relief with the assessor by January 1 of the next year, with a special deadline of June 30, 2025 for tax year 2024. The bill applies retroactively to January 1, 2024, and the presidential-disaster provision only takes effect in a county or municipality if its governing body approves it by a two-thirds vote after the disaster declaration.

Impact

HB0366 would change Tennessee Code Annotated § 67-5-603 governing property tax assessments for damaged improvements, adding a new late-year disaster adjustment rule and a separate optional local relief mechanism for federally declared disasters. It affects county assessors, property owners, and local governments by requiring reassessment or proration when qualifying damage occurs, and it creates a retroactive application back to January 1, 2024 for the new provisions. The bill also conditions part of the relief on local governing-body approval, meaning its practical effect may vary by county or municipality.

Sentiment

No committee transcripts or recorded votes were provided, so there is no direct evidence of debate, support, or opposition in the available record. Based on the bill text alone, the measure appears aimed at providing tax relief and administrative clarity for property owners whose buildings are damaged by disaster, suggesting a generally remedial and taxpayer-relief-oriented purpose. The absence of recorded opposition or amendments in the provided materials makes the overall sentiment difficult to gauge beyond that.

Contention

The main policy questions raised by the bill are how broadly disaster-related assessment relief should apply, how to handle retroactive tax treatment, and whether local governments should control implementation of the presidential-disaster provision. Potential points of contention include the requirement that damage exceed 30 days, the application deadline for owners, the retroactive effective date to January 1, 2024, and the two-thirds local governing-body approval requirement, which could lead to uneven availability of relief across jurisdictions. County assessors and local governments may also be concerned about administrative complexity and revenue impacts, while property owners affected by disasters would likely favor the relief.